Having more than one million subscribers and achieving in less time the success of Netflix, Spotify or Amazon is undoubtedly the goal of every company, especially with the digital acceleration that the whole world is experiencing after the COVID-19 effect. Achieving 100% returns is possible with the application of key trends and innovations, but talking about this topic, we must be clear about what is FinTechs. With a new year beginning, Jason Simon, a specialist in the space, explains the biggest impact FinTechs will have in 2022.
FinTech is the combination of finance and technology, a nascent industry in which companies use technology to provide financial services in an efficient, agile, convenient, and reliable way in which the end-user is the main beneficiary.
There has been an increase in digital payment methods companies. A clear example of this is PayPal, very popular in its beginnings; however, now, there are many payment platforms of this type in Latin America. It is necessary to take into account the evolution of customers, risk profiles, the APIS issue, the way of integrating banking institutions with third parties, means of payment, fraud prevention due to the preponderance of the digital and security issues.
On the issue of fraud, for example, when granting credit to a person, evaluate all the conditions required to grant this credit and not to fall into fraud later. Identity identification, big data, and analytics can also be discussed in this area.
Crowdfunding is the collective financing of private individuals to an idea or project to be developed. Insurtech is the technology applied to the provision of services in the insurance sector; it refers to the modernization and digitization of the insurance sector.
“The Insurtech market is focused on the client and onboarding, that is, all the follow-up and information that has to be provided to the client to get the best out of the service that is being provided and that the user can access from any platform; that is, what is known as omnichannel, because with the COVID, on the subject of insurance, these types of companies, lacking digitalization and providing a face-to-face service, decreased considerably,” indicates Simon.
The issue of omnichannel is very important. For example, if a customer communicates through a call center, to be able to solve either directing with the website, with the mobile application, or face to face with the extension of measures.
COVID-19 has accelerated the need for transformation. 68% of business owners say the pandemic has accelerated their expectation to provide new capabilities, and five business priorities have emerged. The first is the implementation of new technologies: Insurtech and how these can have omnichannel.
Then comes the development of new products and services: One situation that is occurring is the following: if the insurance sector that is part of the financial sector wants to introduce a new service, it happens in many cases that their legal infrastructure is decades old, so it may take them a year to introduce this new service. According to post COVID trends, one year is a long time; ideally, these services should be introduced in three to four months, which becomes a challenge for these companies.
“Improving customer experiences is extremely important in the issue of omnichannel, that through various channels you can communicate with the customer, for this, it is vital to personalize their experiences and how to make each user feel unique,” explains Simon.
Automated processes are very important for middle office, back office and backend organizations. These processes can be reduced from hours to minutes or, in the case of introducing a new service, reduce it from 52 weeks to 17 weeks, for example. And last but not least is the improvement of security, an issue that is undoubtedly of paramount importance for organizations.
A survey in which 150 executives of different nationalities and specialists were interviewed to obtain information on how technology and insurtech are influencing distribution strategies, found that these are the post-Covid trends.
Investment in direct-to-consumer channels to distribute services and products will continue to grow, with 70% of respondents agreeing. Traditional channels such as brokers and agents will continue to prevail. Specifically for more complex lines of business, 64% believe this to be the case.
Improving the customer experience by adopting an omni-channel system was also highlighted. 43% think it is very important. Given these results, Simon concludes that “it is no longer the biggest fish that eats the smallest, but the fastest fish,” so the key for finance in 2022 is in the trend and innovation.